When Individuals in a Sample of 150 Were Asked Whether

question 28

Multiple Choice

When individuals in a sample of 150 were asked whether or not they supported capital punishment, the following information was obtained. $$\begin{array} { l l } \text { Do you support } & \text { Number of } \\\text { capital punishment? } & \text { individuals } \\\text { Yes } & 40 \\\text { No } & 60 \\\text { No Opinion } & 50\end{array}$$ We are interested in determining whether or not the opinions of the individuals (as to Yes, No, and No Opinion) are uniformly distributed.The number of degrees of freedom associated with this problem is

• A) 150.
• B) 149.
• C) 2.
• D) 3.

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Definitions:

Risk Premium

The extra return expected by an investor for holding a risky investment over a risk-free one.

Well-Diversified Portfolios

Investment portfolios that contain a wide variety of assets, aiming to minimize risk by spreading investments across different sectors or asset classes.

APT

Abbreviation for Arbitrage Pricing Theory, a multifactor financial model that describes the relationship between the return of a portfolio and the return of a single asset through a linear combination of macroeconomic factors.

CAPM

A model identifying the connection between the expected returns of assets, primarily shares, and their associated systematic risk, known as the Capital Asset Pricing Model.